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Time For AUD/USD Longs in Risk-On Trade Mode?

Risky assets are higher today, because of cut in China’s reserve-ratio requirement over the weekend by 50BPS to 20.5%, effective from February 24th.

That means that banks are now allowed to lend more money, which of course is good for economy. That’s why we saw a gap higher on commodities, stocks and lower on USD dollar; against the majors, as usually in Risk-on situation.

Finance ministers from the Eurozone are expected to approve a rescue package for Greece today, which is also supportive for the risk trade.

In this week we still favor more strength on FX-majors against the USD since market reversed last Thursday; Euro from 1.2970, Cable from 1.5640, Swiss franc from 0.9300,…

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Risk Disclosure

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.